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Cannabis tax prop on ballot

By LaMesa on October 26, 2018

Jeff Clemetson | Editor

On Nov. 6, La Mesa residents will vote on Proposition V to decide whether the city should impose a special tax on medical marijuana businesses that were authorized under Proposition U, passed by voters in 2016.

“When Prop U passed, there was no excise tax or business tax put on medicinal cannabis,” said La Mesa City Councilmember and Prop V author Bill Baber. “And, yes, [cannabis businesses] take more resources. We need more staff to process the permits. It takes police resources, too. We also plan to use some of the money to drive out the illegal businesses – the sketchy businesses that pop up on University Avenue and El Cajon Boulevard.”

In addition to raising money by taxing legal businesses to cover added expenses of allowing them to operate in the city, Prop V will also help drive out illegal ones by including language that taxes those businesses as well.

“We believe that it can be interpreted that if you have an illegal cannabis business, you still have to pay your tax,” Baber continued, adding that it will be used as a tool by the city to close down illegal shops. “Sort of the Al Capone maneuver. Remember, Al Capone wasn’t gotten for racketeering, he was gotten for tax evasion.”

The proposition also includes language that prepares the city for recreational or adult use cannabis businesses, which Baber said the City Council is currently preparing an ordinance to allow.

“Since Prop U was only medicinal, the only way you can do an adult use would be through an ordinance, which we are working on,” Baber said.

Although Prop V allows for a range of tax — from zero to 6 percent — the city tax on cannabis will start at 4 percent of gross receipts, if the measure passes. Neighboring San Diego taxes cannabis businesses at 5 percent. Baber said the city estimates $1.5–$2 million annually from the tax. He also said it will likely be supported by voters.

“Actually, nobody even filed an argument against it,” he said, attributing the support for the measure to the “pretty broad coalition” of public safety officials and people in the cannabis industry that had input on it.

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